Investing in commercial real estate can be a lucrative trade. But it may end up not being so too when it sits in the listing for too long and no one is renting. When that happens you don’t just lose the money you invested but you also start losing even more money for as long as it stays vacant. That kind of situation is frustrating for anyone that’s why you need to fix it as soon as possible.
Implementing better marketing techniques like 3D virtual tours should immediately help generate more interest in your listings and boost your sales. But aside from looking for ways to upgrade your marketing, you should also figure out the possible problems that are keeping your properties vacant. Here are some of the possible ones and how you can fix them.
Rates That Are Not Competitive
When your commercial real estate rates are either too low or too high, that’s a problem. Too low rates give off an impression that there’s a problem with the place which is why it’s being leased for cheap. While going to high deters good deals.
This is why it’s important you understand the current market pricing depending on your area and the condition and quality of the property you’re renting out. Consult reputable leasing firms or project leasing brokers on the matter so that you can properly price your space and not miss out on deals.
Tenant Improvement Allowances That Are Not Competitive
This is especially important if the property you’re renting out is quite old. Actually, if this is your case, it would be better to offer slightly higher tenant improvement allowances than the market dictates. This will help get people looking for a more affordable place but still wouldn’t take one that looks like will fall apart on them.
Even newer places offer competitive TI allowances, so it’s really better if you do as well, otherwise you’d lose out a lease on them. Look up properties with a similar condition to yours and match the typical TI allowance that they offer. Like always, pay attention to location, market trends, and other factors to make sure you’re not going too high or too low on the TI allowance.
Old Or Worn Down Properties
People will naturally prefer aesthetically pleasing properties complete with amenities over old or worn down places. Especially if they plan to use it as an office space. But even those looking for apartments will always choose better-looking ones even if they have to pay a bit more, than settle for one that looks dated and seem like it needs a lot of repairs.
To solve this, you can discuss it with your leasing team and property managers to know what renovations you should invest in and get your property off the market. It may be something as simple as repainting and modernizing your landscaping. Or it could be adding a tenant lounge or communal gym. It all depends on the improvements that competitive properties often have and how much money can you actually put into it.
Poor Marketing Efforts
If you honestly think there is no particular problem with the property itself but it’s still not leasing, then it’s possible it’s not being marketed well. If despite all the positive things about your commercial property, it’s not getting the attention of target tenants then it’s possible your marketing campaign is not enough.
Flyers, listing pages, photos and videos, and email campaigns are great but nowadays, they’re the bare minimum when it comes to marketing properties. If you want your property to get noticed and actually be leased, you need to invest in newer technology like Matterport 3D virtual tours. Providing a virtual tour that represents your property listing really well is a highly effective marketing strategy that will leave a positive and lasting impression on potential renters. This is especially because only 10% of agents today use virtual tours to market listings. Usually, it’s only photos and videos. So with virtual tours in your services, you’d be elevating yours from your competitors to an entirely new level.
Negative Reputation About The Property
If your property is known to have a difficult property management team, has a poor location or not close to amenities, don’t have enough parking, has been reported to have construction issues, or an accident happened in the building, it’s no wonder it remains vacant.
If you have all of these issues and possibly more, you’ll need to rebrand your property’s identity entirely. Give it a new name or market it to a new audience. But if you’ve fixed the particular issue you suspect is keeping people from renting your place, you need to highlight the improvement and promote it thoroughly so that your target audience is aware of the change.
When it comes to location, all you can do is offer unique amenities or interesting interiors because you can’t really do anything about the location. And it’s always a good idea to add amenities, especially if other properties in your area are upgrading too. You need to keep up or you’d be left behind in the competition. And of course, every time you improve something always make sure you promote that extensively. Announce it to your website, listing page, social media, upload photos, videos, and virtual tour of your new and improved real estate property.